Welcome to today’s CBS fourth quarter and full year 2008 earnings call. Today’s conference is being recorded. At this time I would like to turn the call over Mr. Adam Townsend, Executive Vice President Investor Relations. Please go ahead, Sir.

(Audio begins with Adam Townsend already speaking) Sumner will have opening remarks and we will turn the call over to Les and Fred who will discuss the strategic and financial results. We will then open the call up to questions. Let me note that statements on this conference call relating to matters which are not historical facts are forward-looking statements, which involve risks and uncertainties that could cause actual results to differ. Risks and uncertainties are disclosed in CBS Corporation's news releases and security filings. A summary of CBS Corporation's fourth quarter and full year 2008 results should have been sent to all of you. If you did not receive it, please contact Poonam Desai at 212-975-3367 and she will get it to you. A web cast of the call, the earnings release and other information related to the presentation can be found on our website at www.cbscorporation.com. Now I'll turn the call over to Sumner.

Thank you. Good afternoon everyone. I thank you for being with us today. I doubt that we have ever seen a global economy as difficult as the one we are witnessing right now. The fact is, as conditions worsened throughout 2008 every industry has been affected. Unfortunately as of now 2009 is showing little sign of improving. One thing is clear; in the difficult environment CBS is doing an exemplary job of managing its businesses to today’s challenges and equally important tomorrow’s opportunities. Our focus is on producing world class content; the kind that people want to watch, want to hear, want to read and want to stream. We have always recognized that content is king. While we focus on our content I must tell you we are also focusing on our costs and on our balance sheet at a time when all would agree it is crucial to do so. For those of you who didn’t hear me express my views about National’s negotiations with its lenders on the Viacom call I will simply reiterate my statement that we are making very good progress with our creditors. I have also said before we have not since our original sale sold a single share of CBS or Viacom and our lenders are not urging us to do so. Now with respect to the CBS dividend I can tell you that the topic has been discussed with the lenders and it will not impact the successful conclusion of the discussion. That is the update. Again, because of the ongoing nature of the discussions I must decline to further comment. Let me say this in conclusion, with all the difficulties in the economy today it is a clear advantage that we have a world class management team at CBS to lead the way. So it gives me a great deal of pleasure to turn this call over to CBS’ CEO, my friend and by the way a truly great executive, Leslie Moonves.

Thank you very much Sumner. Good afternoon everybody. Thanks for joining us today to discuss our 2008 fourth quarter and full year results. By now you have listened to enough of these calls to know that I am going to tell you we are operating in a very difficult environment. Some say the worst since the 1930’s. Clearly the market place has been sharply affected by the recession as well as the very unstable credit markets particularly in the last quarter of the year. Our advertising business has obviously been caught in this downturn especially our local businesses having a significant impact on our television and radio stations as well as outdoor. Network and interactive revenue are holding up better and our ratings and internet traffic success are bringing in rate increases even in this economy albeit not nearly at the levels we would like. As you know many of our businesses are dependent on advertising but it is also important to point out that advertising now accounts for just 2/3 of CBS’ revenue. We like the advertising business over the long term. We love its margins. Right now we also like the way our non-ad supported businesses are providing a buffer in this market place. Like most companies today we are primarily focused on managing our businesses so we can capitalize on the upturn when it occurs. We feel the majority of the top line pressure we are experiencing is related to the economic environment and not secular issues. Given the success of our content led by the number one television network we are confident that our results will improve when the overall economy is strong again. Now, over the past year we have taken a number of steps to position ourselves for future success. First, we continue to…

Thank you Leslie. Good afternoon to all of you. I would like to focus my comments on key actions we took to meet the challenges we faced in the fourth quarter and to discuss highlights of our operating performance during 2008. In response to the rapid drop at the end of 2008 in the local and national economy our businesses moved quickly to further reduce their ongoing costs. As you know, we began to take actions to lower the cost of our local businesses at the end of 2007 and we have continued this difficult process throughout 2008 as the U.S. economy accelerated its decline into a full blown, widespread recession by the end of 2008. During the fourth quarter we took additional restructuring charges of over $83 million which is reflected in each segment’s operating income before depreciation and amortization and is highlighted further in today’s earnings release information. Radio, TV stations and outdoor account for 70% of the $83 million restructuring charge as our local businesses eliminated numerous positions. Also, in anticipation of continued weak market conditions in 2009 all of our businesses took steps in the fourth quarter to reduce their costs. For all of 2008 the actions we took reduced our annual ongoing costs by over $220 million by eliminating discretionary spending and eliminating positions resulting in restructuring charges for the year totaling over $136 million. Let me now briefly discuss our fourth quarter and full year financial performance. I will end with a discussion of our balance sheet and our strategy for using our strong free cash flow given the very uncertain economic times we currently are faced with. For the full year 2008 our revenues were almost $14 billion, down only 1% from 2007. About 66% of our revenues in 2008 were $9.2 billion…

(Operator Instructions) The first question comes from the line of Doug Mitchelson - Deutsche Bank.

Any chance you could give us more visibility into ad pacing in the first quarter or what you are seeing by media and maybe Les you could talk a little bit more about what you are seeing by category as well that would be helpful.

We don’t like to give a sales pace. Clearly sales in the first quarter are challenged like you have heard elsewhere particularly with TV local and outdoor businesses and particularly with us because you may recall from the first quarter 2008 we had record political sales. At this point we are kind of rolling over almost $30 million in political. I don’t think the first quarter is really indicative of what we are seeing. I would say we are not seeing the markets decline any further but clearly they are down from where we would like them to be.

I know this may come as a great surprise but autos are down. It is obviously a challenged category and an important one to us on a local level. Telcom’s are actually very strong and the options for the network have all been picked up there. Pharmaceuticals for us are actually doing really well. Retail is somewhat down and financial is somewhat down. It is a mixed bag and nothing that would surprise you in terms of categories.

If I could just follow-up could you give us a sense of how much visibility you have for the first quarter? Are you 60% sold out? 80%? 50%? Is that a way to do it and how much visibility do you feel you have in the first quarter?

I think we have pretty good visibility through February but everything is coming in late as I’m sure you’ve heard on every call and the unprecedented amount of pace that we tend to pick up within the month and so what used to be a good leading indicator of the sales pace isn’t as good anymore because things are coming in later. Again, clearly pricing is down and it is a very competitive market out there. It is certainly a buyers market.

The next question comes from Jessica Reif-Cohen - Merrill Lynch.

The first thing is, the second quarter options were due. Could you just talk about what actually you saw for the second quarter? Given the divergent trend in ratings versus the ad market can you talk about how you are even thinking about the up front and how you are positioned for the up front?

Sure. In terms of options once again second quarter options are fairly normal. There are certain categories that are a little slower and certain ones that are very strong. In talking to our sales department at the network we are feeling fairly good about them and overall once again in scatter I would argue that with our ratings, not argue, with our ratings we are getting the lions share of the scatter market. Pricing is up. Volume is not nearly as strong as we would like it to be. Believe it or not we are looking forward to the up front because we got quite a story to tell. As I said earlier we are the only network up in every single category and nobody is up in a single one. We have a better story to tell. There is going to be an up front. There is going to be an up front market and we have a better story to tell. So, in terms of overall it is hard to predict what it will be but we feel strong we will be in the best position to take advantage of it.

TV syndication you mentioned your five series in the back half of 2009. Can you just talk about what percentage has actually been sold and is there any change in the deal terms in light of some of the broadcast bankruptcies?

No, they have all been sold. They have all have domestic cable deals that are strong out of the terms of change. They are all going to happen at the end of the year, or the second half of the year rather of 2009 and they are all completed and they are very healthy in this marketplace. We have been very pleased and there has been no attempt to re-price them or to change the terms on them.

Just to clarify you said these are cable deals?

Most of the drama series are sold primarily to cable and then syndication afterwards. That started back when we got $1.9 million an episode for CSI. So that has continued along with all these dramas. There are a lot of the basic cable companies that are our first buyer. A&E, TBS, TNT or Lifetime, etc. who are all paying very good prices. Once again the international marketplace for all of them not only these five titles but for the rest of our shows remains extremely strong.

The next question comes from Michael Meltz – JP Morgan. Michael Meltz – JP Morgan: You mentioned that you made a pension contribution. What is your expectation for 2009 or is there an expectation and where is your pension balance at the end of the year?

There is no mandatory call on the pension plan as we sit here today because the funding we made at the end of 2008 was a voluntary or pre-payment as we call it or pre-funding so right now there is not to the qualified plan. Clearly we had some unrealized losses although not to the extent others do. As you may recall a large part of our pension plan is in fixed income. We may have had some mark-to-market issues in the stock price because again about 70% of our pension assets are in fixed income. Michael Meltz – JP Morgan: So you don’t expect to have to make another contribution in 2009?

Right. From this point from what I can see now there will not be a required or what I call a mandatory payment. Obviously if the market deteriorates further we will have to revisit it but that as of 12/31 that is not the case. Michael Meltz – JP Morgan: Of the $220 million of annualized cost take out what portion of that would you realize in 2009 that wasn’t realized in 2008?

Well again it was throughout the year so I would say we would get the full year benefit. The local businesses took action at the end of the fourth quarter 2007 so we got some of those and then they took some more in the first quarter. Most of the other actions of the 83 we just talked about came in the fourth quarter so virtually none of it was a benefit to 2008. It will all benefit 2009.

The next question comes from Michael Nathanson - Sanford Bernstein.

Going back to the cost saving question, could you spread out the cost savings of $220 in 2008? Where is that going to be spread? Can you give me a sense?

Again I would say of the $220 probably 60-70% is going to come at the local businesses, radio, TV and outdoor. It is largely employment costs. Discretionary savings have already been done and they have been reflected immediately but those were largely the ongoing is people costs.

That is off the cost base of 2008?

Yes sir.

The second one was you talked a lot today about the non-typical businesses you have. It would be helpful in TV if you could spend some time talking about the profitability in TV which is a large bucket of your different segments. I think some of the people would definitely want to hear that.

I missed part of the question. You said non what?

The non-advertising business. How big is profitability and how about the syndication business and things like that?

Again, the non-advertising businesses are again largely license fees of the programs like Medium. It is syndication revenues for Medium or a CSI. Those are all very profitable but nothing is as profitable as an incremental sale of advertising because basically all you have is a commission cost. So that is a very high incremental margin. These are all very, very attractive margins. Most businesses would give their right arm for them but nothing will compare with the amount of incremental profit you make on an advertising sale.

We don’t break it out. It includes Showtime. It includes DVD sales. It includes syndication. It includes iTune sales, etc. and retrans as well.

But could you break it out it given how much you are stressing how much the business is growing?

As we said overall for the company it is 1/3 of our revenue. Within the TV segment it…

I guess I would say I understand from a number of questions that have come up on that and we have to see how we can do it without creating segments that don’t make any sense. We have some rules as you know with the SEC about how you create a segment. So you really can’t get to a profit number. We might be able to get to some kind of gross margin or something like that but certainly Adam, Leslie and I have been looking at that because I think it is something that people are not seeing how profitable we are and how fast growing it is and that is really where we are focusing because our content is the big driver of most of that.

The next question comes from Michael Morris – UBS. Michael Morris – UBS : On the outdoor business I guess this is a similar question to television but can you give us a little insight into what you are seeing in current advertising trends right now? The comp is not as clear as what has been reported. Have the trends deteriorated in the first quarter? What else are you seeing in terms of the competitive environment there? Then also on the cost side of that business you mentioned the high fixed cost nature but you also just referenced some of the cost in the restructuring that is coming out there. How should we be looking at what you are expecting for cost growth in 2009?

I will break it down to the domestic billboard market and then international. I would say they are both faring much better than TV or radio are. While they are down in pace versus a year ago at this time they are not down nearly to the extent as the others. It is quite a big gap. In international it is the case of local currency however when you put the factor of the U.S. dollar strengthening to almost unprecedented levels against the Euro and the Pound which is what we are most dependent on that is causing it to be translated back to the U.S. dollar and looking worse. The underlying decline in international and domestic are about the same and they are quite a bit lower decline than you are seeing in other businesses. As far as costs, we are taking out again it depends on the market. In the U.S. we are taking out a lot of sort of what I would call variable costs we can get at and streamlining the sales force and taking out layers. As you know we have exited a lot of transit contracts so therefore we are able to take out those costs and they were lower margin. In Europe it is much more about infrastructure overhead because we moved to a model where every country had sort of its own G&A to more of a Pan European approach too and that is significant dollars. That is coming out from there.

The next question comes from Jason Bazinet – Citigroup. Jason Bazinet – Citigroup: I just have a question on the magnitude of the dividend reduction. I think most investors expected some sort of cut but I think the magnitude may be a bit larger. This may be an artificial construct but when you recommended a dividend policy for the board did you say we want to still have a respectable dividend yield for where our stock is now or did you look at it backwards and say we have this $1.6 billion maturity in 2010. That is a year and a half. We sort of think we can comfortably do a billion in cash flow for the next year and subtract the dividend of $135 million or so and that is sort of a comfortable way to sort the dividend? Which way did you come at it? Was it the free cash generation for the business or dividend payout ratio that gives a respectable yield?

The right answer is all of the above. Obviously a lot of time and effort went into the discussion as to what was the right number and when we looked at our yield we still said we would be at the top of all media companies in terms of returning dollars to our shareholders. We also wanted the flexibility and we looked ahead and we looked ahead to what we have due in 2010 and it gave us the best flexibility. There were certain people who wanted to eliminate it altogether. Certain people wanted it to be cut in half. We felt this was the right number for us and a lot of effort went into it. So when you ask which way did we approach it, we approached it from all sides.

The next question comes from Benjamin Swinburne – Morgan Stanley. Benjamin Swinburne – Morgan Stanley: Production syndication you mentioned a number of drivers there; TV DVD sales are strong, international syndication is strong. As we look at 2009 given the five shows going into syndication for you should that business be up year-over-year on the top line? How much international exposure currency headwinds are in that business and how much barter revenue in there which is actually more closely tied to advertising? Then as one follow-up, Les you talked historically about retransmission revenues for the business reaching $250 million over time. I think somewhere around $0.50 a sub. Given that you have a number of deals now in the bag is that number still reasonable? Any update upward or downward on that?

Let me start with your second question first. On the basis of the deals that we have currently concluded yes we are on target for a few years down the line to hit those kinds of numbers. Without revealing what these deals are we are very pleased with all three of these major deals as we have mentioned before. We have concluded about 24 smaller ones but to have a large, the second largest cable operator and second largest satellite group and the largest telco with the numbers we got we are very satisfied. We are very pleased and onward looking we are confident we are going to hit those kinds of numbers. In terms of the syndication there is very little of that which is bartered.

Leslie is right. That is not what we are looking at. Barter to me is advertising. So what we are talking about here is really the license or syndication fee and so that will be significant in 2009 because our only major syndication in 2008 was CSI New York which happened in the third quarter so now we are going with five which is Medium, Numbers, Criminal Minds, Ghost Whisperer and Everybody Hates Chris. A fairly significant increase.

When you look at the new model for syndication, when you are selling primarily as occurred over the last half dozen to ten years when the primary sale is to basic cable the barter becomes a lot less significant than when you were selling sit coms directly to a variety of TV stations and there was a certain amount of cash and a certain amount of barter. Now it is primarily a per episodic fee directly to the cable network and you are not worried about barter. So we will not be affected by advertising in that model and that has sort of been the model for the last number of years.

As far as foreign exchange it really is an indirect effect because we price largely in dollars for the bigger countries but I think your question is would people pull back because their local currency buys fewer dollars. That gets back to the content. These are the kinds of shows that have been extremely successful overseas. Our procedurals. Our dramas. There is nothing to substitute them for so they don’t really have a lot of choice.

If you pick up a guide to one of the top ten shows in every one of the major foreign territories that are spending real dollars you are usually going to see at least two out of three CSI’s if not all three and the procedural dramas we do really, really well in those countries. Benjamin Swinburne – Morgan Stanley: So the CSI in the U.K. and Germany those kinds of markets those deals are done in dollars primarily?

Yes. Again, I think you are trying to go indirectly saying would it hurt their purchasing power. I guess sure. But they had a great fee awhile ago and the dollar was weak and but they have to have the content that is going to draw their local audience.

The next question comes from Doug Creutz – Cowen & Co. Doug Creutz – Cowen & Co. : Could you talk a little bit about where you are in your plans to self produce movies and whether the desire to preserve capital here has limited those plans?

At the moment our plans currently remain to do 3-4 movies this year. We begin production on the first one on April 6. We have announced the beginning of production on two movies. The budgets of both are well below $40 million on both these movies and that is what our game plan is and with our Showtime deal in place and the original plan is certainly working and the capital situation does not affect it.

The next question comes from Marci Ryvicker - Wachovia Securities.

I just want to go back to outdoor for a minute. The drop from Q3 to Q4 was so large, specifically in the U.S. Can you tell us a little bit what happened? Where there completions? Was it just lack of demand? How was national? How was local? Any color would be helpful.

I think what clearly happened as you may recall that through the first half of the year outdoor was growing kind of mid to high single digits. Third quarter kind of went flat and then the fourth quarter as you can see the U.S. numbers actually went into a decline. When you have a decline on a sort of high fixed cost base there and we couldn’t react as quickly until we started picking up the people. That is what drove the margins down. It clearly was the last into the sort of soup as I would call it into the recession and it was doing fine versus relatively versus other local assets we have. Again it still continues to do better and we are working very quickly on taking a lot of cost out where we can.

What about on the top line?

What about on the top line? It paced down in the fourth quarter.

Right but the change between Q3 and Q4 was the revenue drop off due to cancellations or lack of demand?

We didn’t really have cancellations to say. There was just a lack of demand. There was a pull back by a lot of categories that just were, or lower pricing. Our occupancy was actually the same or higher which is sometimes doesn’t make me so happy but pricing was down. The pricing power went to the buyer and it went rather rapidly.

The next question comes from David Miller – Caris & Co. David Miller – Caris & Co.: Les in your prognostication in your prepared remarks you mentioned you believe the second half of 2009 will be stronger than the first half. Is that because of one particular segment of your business you just have greater visibility on versus the first half or is it just because the first half just looks so ugly that it is going to comp easily against the first half and you are fairly confident going into the second half? If you could just flesh that out that would be great.

Number one we have the five syndication titles that I talked about. That is the primary factor that are not there in the first half that will be there in the second half. In addition there have been some cost cutting things that will take effect in the second half of the year. Number three, we expect the network to continue to be as strong as it is and we are now in the dominant position which we hadn’t been and we expect to get the lion’s share of that revenue. We think that will be effective as well.

Thank you. We will be around tonight to answer more questions if you need it.

This concludes today’s conference. We thank you for your participation. You may now disconnect and have a wonderful day.